Traditional Media to Lose Ground to Online in Local Advertising

Source: March 18, 2013 by MarketingCharts staff

BIAKelsey-Local-Media-Outlook-2012-2017-Mar2013

The local media advertising market will expand at a 2.3% compound annual growth rate (CAGR) through 2017 to reach $148.8 billion, from $132.5 billion last year, according to a new forecast from BIA/Kelsey. But all of that growth will come from online and digital media, with a 12.3% CAGR compared to a -0.3% CAGR for traditional media. The forecast calls for traditional media’s biggest drop to come this year, down about 2.2% to $107 billion. Traditional media ad spend will see a big gain in 2016, no doubt due to political ad dollars, but fall again the following year.

By contrast, local online media spend will increase by about 11.7% this year, and continue that run with a 13.2% climb next year.

The growth in online and digital media spending, coupled with the stagnation in traditional media spend, means that traditional media’s share of the local ad market will decline by about 10% points over 6 years, from 82.6% in 2012 to 72.4% in 2017.

The forecast follows a series of reports which have seen a similar shift occurring from traditional to digital ad spending, although TV remains the primary ad buy.

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